Somewhere— from the highlands of East Africa to the Small Island Developing States of the Caribbean or the Pacific— a farmer is struggling to coax life from her modest plot that has been battered by extreme weather, from withering droughts to torrential floods. Her tools are basic, her seeds vulnerable to erratic rains, her daily earnings rarely stretch beyond a dollar, and she is among the 730 million people facing hunger today. While she didn’t cause this crisis, she is on the front lines of its impact— and she remains largely excluded from the resources she needs to adapt.
This farmer’s situation is not unique; it’s emblematic of the challenges faced by 510 million smallholder farmers worldwide, who produce between 25% and 35% of the world’s food but receive less than 1% of all financial resources allocated to help individuals, communities, governments, and businesses mitigate and adapt to the impacts of climate change.
As I write this article, the sun rises on Food, Agriculture and Water Day at COP29, the United Nations Climate Conference in Baku, Azerbaijan— otherwise known as “the Finance COP.”
The COP29 Presidency’s Harmoniya Climate Initiative for Farmers, has launched, highlighting the critical role of family farmers in food system adaptation.
Over the past week, COP29 co-chairs have released (and re-released) draft text on the New Collective Quantified Goal (NCQG) for climate finance, aimed at providing funding for developing countries’ climate plans post-2025— a successor to the previous $100 billion per year pledge from developed countries.
Key questions remain about the quantity, quality and allocation of financing to be provided, with the United Nations (FAO, WFP, IFAD) and CGIAR recommending that “the NCQG should consider sectors such as agriculture, and water, and the entire agrifood systems to ensure global food security and take into account the financing and investment needs at around USD 300-400 billion per year to transform agrifood systems to meet the 1.5-degree target.”
BAKU, AZERBAIJAN – UNFCCC COP29 entrance at Olympic Stadium. Food, Agriculture and Water Day is on … [+]
But while food and agriculture are finally beginning to get a seat at the table, smallholder farmers continue to fight for the scraps that fall to the ground.
According to One Acre Fund, a social enterprise that works with five million smallholders in Africa, building climate resilience will require $300 per farmer annually— totaling $153 billion per year for smallholder farmers. Yet just $2 billion of global climate finance currently reaches them, leaving a $151 billion gap.
The International Fund for Agricultural Development (IFAD) also provides a grim picture. Based on its 2019/ 2020 calculations, IFAD estimates the annual gap at $75 billion.
The Food and Agriculture Organization highlights a broader need of $680 billion annually to transform agrifood systems, in alignment with the Paris Agreement and Sustainable Development Goals.
Though the figures vary, the message is consistent: for the millions of farmers who feed their families and communities on less than 2 acres of land, the finance gap is massive— and time is running out. Global hunger remains at its highest in over a decade, with 8.9% of people worldwide facing undernourishment, and the current rate of climate action is projected to lead to a disastrous 3.1°C rise in global temperatures by the end of the century.
A report released this week by the Global Alliance for the Future of Food reveals that in 2021-2022, only 14%— approximately $1.3 billion— of $9.1 billion in international public climate finance for agriculture and land use was directed toward small-scale farmers. Just 1.5% of this funding supported sustainable, agroecological food system initiatives.
A family of farmers transplanting rice seedlings in a field during the paddy sowing season in a … [+]
“The failure of governments and funders to recognize the importance of family farmers is putting global food security at risk,” says Stephen Muchiri, CEO of the Eastern African Farmers Federation.
New research from Family Farmers for Climate Action— an alliance of farmer organizations that represent more than 50 million farmers in Africa, Latin America, Asia, and the Pacific— released on November 19th is exposing the systemic barriers within major climate funds that hinder farmers from accessing climate finance or influencing how it is allocated.
A review of 40 Global Environment Facility (GEF) and Green Climate Fund (GCF)-funded projects revealed that none provided direct financing to family farmers or their organizations, and less than 20% involved farmers in decision-making. Researchers identified significant barriers, such as complex application processes requiring extensive documentation, which hinder grassroots access to funds.
Only one-third of the $2.6 billion spent on agriculture, fishing, and forestry between 2019 and 2022 supported small-scale farmers in adopting sustainable, climate-resilient practices.
A farmer checks on a water pump in Shendi, located on the banks of the Nile 190 kilometres (120 … [+]
Azerbaijan, the host country of COP29 and a recent Board Member and co-chair of the Food and Agriculture for Sustainable Transformation (FAST) Partnership— a multi-stakeholder initiative aimed at redefining how climate finance supports agrifood systems, particularly for smallholder farmers and other vulnerable groups— is at the precipice of an opportunity to stay true to the partnership’s ambitious promises.
“To unlock the potential of agrifood systems and reach the most vulnerable, we need more climate finance and better climate finance,” says Kaveh Zahedi, Director of FAO’s Office of Climate Change, Biodiversity and Environment.
Better climate finance is not always about more money— it’s about spending smarter. Poorly targeted climate finance risks becoming a wasted opportunity, while well-placed investments can ripple outward, benefiting entire communities.
A recent report by the Environmental Defense Fund— Quality Matters: Strengthening Climate Finance to Drive Climate Action— emphasizes the importance of quality in climate finance. It’s not just about how much is spent, but how effectively it’s spent. Funds must be accessible to farmers, designed to create lasting impact, and offered at concessional rates that reflect their vulnerability. Poorly targeted finance may temporarily plug a hole, but well-targeted finance can build a dam.
A farmer scoops sea salt at the Kusamba Beach in Klungkung, Bali, Indonesia. The salt farmers in … [+]
Money should help smallholder families to send their children to school, invest in better tools, training and technology, and weather future crises.
On Food, Agriculture and Water Day, the Save Soil Movement and 78 leading NGOs presented recommendations to the United Nations Framework Convention on Climate Change (UNFCCC), calling for an ease in access to increased climate finance for farmers to support regenerative practices, incentivizing private investment in regenerative agriculture, and integrating soil restoration into national climate strategies.
Sadhguru attends COP29. Save Soil is a global movement launched by Sadhguru, to address the soil … [+]
“Finance is needed for global soil regeneration, because the people who will deliver this en masse are small farmers, who need support to transition to regenerative practices,” says Praveena Sridhar, Save Soil’s Chief Technical Officer. “It’s such a compelling climate solution, that the funding should come from climate finance.”
One Acre Fund’s approach centers on providing farmers with a comprehensive bundle of support, including quality seeds, training in regenerative agriculture, crop insurance, and access to carbon credit markets which it says can increase their annual income by $790— enough to transform their livelihoods and create long-term resilience. At scale, such interventions could generate $403 billion in value annually, including higher yields, better soil quality, and healthier families, according to the social enterprise.
Michele Kagari, Senior Director of Government Relations and Policy at One Acre Fund, says that this scenario shift is critical for smallholder farm families, who stand at the nexus of climate change, poverty, and food security.
“Smallholder farmers worldwide produce the majority of their communities’ food, they are the primary stewards of the land, and they make up a considerable proportion of their countries’ GDP. They feed an estimated two billion people— roughly a quarter of the world’s population— so an investment in smallholder farmers is a direct investment in global food security.”
One Acre Fund is advocating for systemic change in climate finance and calculates that just 53% of the $153 billion needed annually should come from public funding, amounting to around $80 billion, which is less than 10% of the $842 billion that developed countries spend annually on agricultural subsidies.
“Helping farmers thrive is vital not only from a climate justice angle, but also because of a range of societal benefits they secure– from protecting biodiversity and forest preservation (by ensuring they don’t feel pressure to encroach in new land) to reinforcing the security and stability of rural communities,” says Kagari.
Family Farmers for Climate Action and its members believe that funds from public finance institutions and philanthropic donors should be directed to family farmer organizations, ensuring that more resources reach grassroots communities where they can have the greatest impact.
Farmers harvest olives, albeit late, despite the decrease in production due to drought in Tastour … [+]
“Getting more finance direct to grassroots farmers organizations and giving farmers more control over our own adaptation efforts is the most effective way to boost climate resilience of family,” says Stephen Muchiri.
Innovative financial solutions that channel private investments and climate funding hold the key to empowering rural communities and creating stronger, more resilient food and agriculture systems in the world’s most vulnerable regions.
“Across the Global South, smallholder farmers play an outsized role when it comes to food security, and yet they receive a tiny fraction of climate finance to cope with increasingly unpredictable conditions,” says Natasha Hayward, program manager at the Global Agriculture and Food Security Program (GAFSP), the world’s only multilateral partnership for food and nutrition security financing.
Access to financial services remains a major hurdle for smallholder farmers and early-stage agrifood businesses, limiting their capacity to meet increasing local and regional food demands.
Since 2010, GAFSP has been helping to unlock finance for smallholders and has mobilized over $2.5 billion in donor resources to reach more than 20 million people across the Global South.
This year, GAFSP launched the $75 million Business Investment Financing Track (BIFT), designed to de-risk private investments in agrifood systems. By catalyzing affordable finance for smallholder farmers, producer organizations, and agribusinesses, BIFT aims to promote sustainable and climate-smart agricultural practices.
“The challenges facing global food systems continue to evolve and increase in complexity with the uneven impacts of climate change,” says Gabriel Ferrero, Spain’s global food security ambassador, currently serving as a strategic advisor to GAFSP. “Smallholder and family farmers, who produce more than 80% of the food in value, are especially vulnerable.”
Other programs like the Agriculture Innovation Mission for Climate (AIM for Climate), the Vision for Adapted Crops and Soils (VACS), and the U.S. government’s Feed the Future Initiative are focusing on leveraging innovative tools and technologies to boost farmer resilience and adapt agriculture to meet the challenges of a changing climate.
A woman farmer holds assesses her crop that was lost due to the lack of water in a Chinampa or … [+]
As negotiators finalize the NCQG at COP29, there is an urgent need to ensure that smallholder farmers are not left behind. The annual $100 billion previously committed by developed countries to climate adaptation is woefully inadequate. But the right investments— tailored to smallholders’ needs— can unlock extraordinary potential.
“With COP29 focusing on finance, this year is a much-needed chance to close the gap and develop creative solutions to get more funding to those on the climate frontline,” says Hayward.
Closing the climate finance gap for smallholder farmers is not about charity, or even about fairness. It is strategically prudent. Every dollar invested in climate-resilient agriculture pays dividends, reducing future costs by mitigating the impacts of climate change— and securing the global food system.